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Credit Information
Date: Mar 15, 2005
Contributor: Javier Monsen
Minnesotans encouraged to order free credit reports
Beginning March 1 Minnesotans may request one free consumer credit report annually from each of the three main credit reporting agencies. This opportunity is possible through the Fair and Accurate Credit Transaction Act (FACT Act) of 2003.
A credit report contains information on where you live, how you pay bills and whether you've been sued, arrested or filed for bankruptcy. Nationwide consumer reporting companies sell the information in your report to creditors, insurers, employers and other businesses that use it to evaluate your applications for credit, insurance, employment or renting a home.
The opportunity to request the free credit reports is being phased-in across the United States over a nine-month period, rolling from the West Coast to the East Coast. The process began Dec. 1, 2004. Minnesotans and others who live in the Midwestern states of Illinois, Indiana, Iowa, Kansas, Michigan, Missouri, Nebraska, North Dakota, Ohio, South Dakota and Wisconsin can order their free reports anytime after March 1.
Free credit reports can be requested one of three ways: use the central Web site at www.annualcreditreport.com, call the toll-free credit report number at (877) 322-8228, or fill out and mail in the Annual Credit Report Request Form, which is available online or by requesting it from Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281.
Don't contact the three nationwide consumer reporting companies individually - they are only providing free annual credit reports through the central Web site www.annualcreditreport.com.
Consumers may also be interested in finding out what their credit score is. A credit score is a rating that determines credit worthiness and the likelihood and timeliness of loan repayment. A credit score may impact whether or not you receive credit as well as influence other credit issues such as interest rates paid.
A high score would create an opportunity to be offered the lowest interest rates and fees. Low credit scores affect not only credit costs, but things such as insurance rates. Credit scores may range from 400 to 900, with the average around 700. According to the scoring model, as the score increases, the risk of default decreases.
Consumers may purchase their credit score when they request their free annual credit report through the Web site.
Several things can be taken to maintain a good credit score:
1. Pay all bills on time.
2. If a bill payment is missed, get the payment current and then keep it current.
3. If you are having trouble paying all your bills, contact the creditor or see a legitimate credit counselor.
4. Know that paying off a collection agency account or closing an account that was delinquent will not remove the action from your credit report.
5. Keep the balances owed on credit cards and other lines of credit as low as possible.
6. Pay off debt rather than move it around to other agencies.
7. Do not open a number of new credit card accounts just to increase availability of credit.
8. Do not close credit card accounts as a short-term solution to increasing your credit score.
9. If you have had credit for only a short period of time, do not open many new accounts too rapidly.
10. Prudently apply for and open new credit accounts when needed.
11. Manage credit card accounts prudently - pay off the balance each month if possible.
12. Remember that simply closing an account does not make it go away, especially if it has a bad credit history.
For more information relating to "Credit Information", please visit our Credit Information page. |
